Cloud Computing is the idea of computing as a utility. This isn’t a fundamentally new idea, but it’s now a commercial reality for users (businesses and academics) to pay for computing resources as they use them, with no upfront cost, and with effectively infinite scalability.

One of the most influential reports on Cloud Computing is “Above the Clouds” . The authors attempt to clear up the confusion in terminology around Cloud Computing and distill what’s new about it.

One of the important points is that people sometimes describe web services like Google Docs or Gmail as cloud computing. The authors separate these Internet applications, which they call Software as a Service, from the hardware and systems software in the datacenters that provide those web services, which they call Cloud Computing.